Australia telecommunications

Vodafone buys Lebara mobile assets in Australia

On September 13th Vodafone Hutchison Australia Pty Ltd (VHA) announced the purchase of mobile business assets of Lebara at an undisclosed value.

Analysis

Lebara Mobile has been a mobile virtual network operator (MVNO) for Vodafone since 2009. MVNOs provide telecoms services on telecoms infrastructure not owned by them. Under the terms of the deal, VHA will be able to use Lebara's mobile base and its brand in Australia, allowing it to tap Lebara's popularity among the growing migrant population in the country.

The company also expects to benefit from the addition of Lebara's reported 130,000 subscribers in a nearly saturated mobile market. However, the takeover will not result in any change for Lebara's existing subscribers, employees and customer service agents.

VHA, which is jointly owned by UK-based Vodafone and a subsidiary of Hong Kong's Hutchison Whampoa, claimed that its 4G network covered 96% of Australia's metropolitan population. In a bid to widen its user base, the company is constructing 32 regional mobile base stations, with an investment of A$9m (US$6.5m).

The Economist Intelligence Unit expects the Australian mobile market to have about 140 subscriptions for every 100 people in 2020, from about 135 in 2015. It also estimates a rise in mobile revenue to US$14.3bn in 2020, from a total of US12.7bn recorded in 2015.